Skip to content

Conservards Want To Privatize American Public Infrastructure

May 9, 2007

Mr. C. read an interesting article on tompaine.com yesterday. It is an article called Coming Soon To A Toll Booth Near You by Sam Pizzigati. In the article Mr. Pizzigati discusses how in the past our tax dollars were spent on increasing the commons of the public. By commons Mr. C is referring to things like roadways, airports, community buildings, water ways, etc.Stealing our infrastructure?

In the last 30years because of the policies that Ronny “Bonzo” Reagan started and his successor King George have extended, local governments don’t have the funds to invest in public infrastructure. In fact they don’t have enough money to even provide the basic services that most communities need. Hence many state governments are looking to sell or lease our public infrastructure to various private Wall Steet vultures.

When will the American people say enough is enough and kick these conservards to the curb? When will people wake up to the fact that conservatards hate government and are picking the pockets of tax payers to line the pockets of Wall Street? Hopefully it will be before most of us end up living on the street.

Coming Soon To A Toll Booth Near You

Sam Pizzigati

May 08, 2007

Sam Pizzigati edits Too Much, an online weekly on excess and inequality.

Fifty years ago, almost all major corporations and wealthy individuals in the United States paid a hefty chunk of their income in local, state and federal taxes. Those tax dollars, in turn, helped build and maintain roads and bridges, sewers and schools, airports and harbors—what economists call our “public infrastructure.”

This tax-and-spend cycle helped keep America both relatively equal and efficient. The taxes on high incomes discouraged grand accumulations of private wealth. The spending on infrastructure encouraged economic growth and opportunity. In today’s United States, unfortunately, this virtuous cycle no longer spins. The wealthy no longer pay hefty taxes. Local, state and federal governments no longer invest in infrastructure. Yesterday’s United States built bridges. Today’s builds fortunes.

And now those private fortunes are taking aim at America’s public infrastructure. Wall Street bankers and investment firms, Business Week reports, are rushing to raise cash for public infrastructure buyouts.

“Investors can’t get in fast enough,” the weekly notes. “They recently deluged Goldman Sachs with $6.5 billion for its new infrastructure fund, more than twice the $3 billion it was seeking.”

The buyout artists at outfits like Goldman Sachs, analysts estimate, will soon have $500 billion to wave before governors and lawmakers “scrambling for cash to solve short-term fiscal problems.”

These governors and lawmakers, unwilling to tax the rich to maintain America’s roads, are now taking bids to sell these roads to the rich. In Harrisburg, for instance, Democratic Governor Edward Rendell is busy privatizing the 537-mile Pennsylvania Turnpike. Last year, in Indiana, state lawmakers cut a $3.8 billion deal that gives private investors a 75-year lease to run the Indiana Toll Road. In all, $7 billion worth of public infrastructure has gone private over the last two years. The next two years, Business Week predicts, could see “$100 billion worth of public property” turn private.

Why the investor rush to public infrastructure? Leases to run toll roads and bridges amount to licenses to print money. Government highway officials generally need to win public approval before they can raise tolls. Private road managements can charge whatever tolls the market can bear.

Tolls on the Chicago Skyway stood at $2 in 2005, the year the road became the first modern thoroughfare to go private. The Skyway toll, investors expect, will hit $5 by 2017.

Private investors have, of course, other ways to squeeze earnings out of infrastructure. They can skimp on maintenance—or attack worker wages. Toll-takers on the Chicago Skyway, Business Week points out, “used to be full-time city employees with rich benefits.” The Skyway’s new private operators now run their show with a mostly part-time, no-benefit workforce.

Higher tolls, cheaper workforces. Do the math. Wall Street analysts certainly have. They now see infrastructure, notes Business Week , “as a separate asset class, safe like high-grade bonds but with stock market-like returns.”

In today’s America, the ultra-affluent are having an increasingly hard time getting those “stock market-like returns” from marketing private-sector products and services to an increasingly over-indebted American middle class.

Middle class Americans, our deepest pockets have figured out, are already paying for public-sector products and services, and these affluents have convinced themselves that they richly deserve a piece of this public payment pie. In a deeply unequal America, with ever-greater pools of wealth concentrating at the top, they so far seem to have the dollars—and the power—to get it.


Advertisements
3 Comments leave one →
  1. May 10, 2007 4:48 pm

    OK, call me an idiot, because I know I must be missing something here, but how can a state government essentially sell public infratructure? Is that even legal? How does the average citizen, especially those who are state workers, not have to agree to such a deal? I’m seriously confused, and ultimately livid about this. I really hate being an American sometimes.

  2. May 11, 2007 3:52 pm

    Good question Kerstin,

    I honestly don’t know the legalities of how they do it but it seems they do it anyway.

    Sometimes the governments don’t actually sell the property but sell extremely long leases to manage a piece of property. Sometimes these leases are 99 years. So they might as well sell the property to the company.

    I’ll try to post more information as I find it.

    As always, if any of The Conservatards readers want to submit an article email it to the following address:

    mrconservatard@yahoo.com

Trackbacks

  1. Bibles and Airports » Conservards Want To Privatize American Public Infrastructure The …

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: